France’s 2027 Finance Bill proposes a 30% reduction in the exceptional CIT surcharge for large companies, alongside changes to electronic invoicing, business transfers, green investment incentives, individual income tax brackets, and local government finances.
The French government presented the Finance Bill for 2027 to the National Assembly on 1 October 2026 for parliamentary consideration. The proposed 2027 budget aims to address a challenging economic backdrop characterised by a widened deficit of 5.4% of GDP in 2026 and mounting debt interest charges
Corporate income tax (CIT) surcharge for large companies
The budget includes a 30% reduction in the exceptional corporate income tax surcharge levied on large corporations.
Specific surcharge for shipping companies under the tonnage tax regime
The budget proposes targeted contributions from sectors benefiting from favourable economic conditions or windfall rents, while continuing structural support for shipowners and maritime activities. The executive summary does not provide details on the reintroduced tonnage tax surcharge for shipping companies with turnover of EUR 1 billion or more.
Electronic invoicing
The budget outlines the generalised rollout of mandatory electronic invoicing starting 1 January 2027, for all VAT-liable businesses to simplify reporting and strengthen anti-fraud controls.
Business & family transfers
Rather than listing a general gift tax rate cut, the budget kit focuses on business transmission and intergenerational ownership transfers:
- Pacte Dutreil: Fully preserved without modifications to secure family business transfers.
- Pacte Papin: Introduces new incentives to encourage employee buyouts when business owners retire, including additional capital gains tax allowances for retiring owners and reduced registration duties on transfers.
Extension of green industry tax credit (C3IV)
The scope of the C3IV is expanded to cover investments in electrical power grids, solar thermal energy, battery packs for electric vehicles, and permanent magnets for electric propulsion.
Industry 4.0 extraordinary tax deduction
An extraordinary temporary tax deduction is introduced for SMEs and mid-caps investing in digital and automated equipment, such as industrial robotics, 3D printing, advanced analytics, and generative AI.
Agricultural investment deduction
A new special tax deduction supports investments labelled “future agricultural projects”.
Local finance and green tax measures revised
The 2027 budget reduces the standard VAT compensation rate for local authorities while introducing a 16.4% bonus rate for green transition and sustainable mobility investments. It also requires larger local authorities to contribute EUR 2.5 billion to fiscal consolidation, introduces a kerosene levy to support synthetic aviation fuel production, and revises older renewable energy contracts to reduce excessive rents.
Adjustment of individual income tax brackets with inflation
The budget confirms the indexation/revalorisation of the individual income tax scale in line with the annual inflation rate. This measure is designed to preserve household purchasing power and prevent “tax bracket creep,” protecting 20 million taxpaying households from an unlegislated tax increase caused solely by inflation.
The budget proposes indexing income tax brackets to inflation, noting that failure to do so could result in nearly 500,000 low-income households becoming liable for income tax for the first time. The general presentation does not specify the relevant legislative article number..
